Retiring Next Year? Now Is the Time to Start Designing What Your Retirement Will Look Like

The year before retirement is when you shift your focus from growing your portfolio to intentionally designing an income and tax strategy that aligns your resources with your new life purpose.

By Brian Skrobonja, Chartered Financial Consultant (ChFC®)

published 6 February 2026

in Features

An older couple smile as they cuddle on their sofa and look at a tablet together.

If you plan to retire in the next year, the most important period of preparation is right now. When retirement shifts from a distant goal to an operational reality, time takes on a different meaning.

Yet this is often when planning becomes unintentionally narrow, with attention focused almost exclusively on investment performance and market returns — just as the role of money is about to change.

That focus is understandable. For decades, the primary objective has been growth: Accumulate more, save more, invest more. But retirement doesn't reward the same behaviors that helped you get there.

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As the finish line approaches, the question quietly but fundamentally changes — from "How much can I grow?" to "How does this all work together to support my life?"

This transition is less about market timing and more about intentional design. Retirement isn't a portfolio event; it's a life event. And life events require clarity of purpose, alignment between resources and expectations and a strategy built around use — not accumulation.

The danger in waiting until the final months before retirement is that growth-oriented thinking tends to persist long after it's helpful, delaying the mental and strategic pivot that retirement demands.

A period of reorientation

The year before retirement should be treated as a period of reorientation. It's when focus shifts from abstract future values to concrete outcomes, from statements and balances to lifestyle and sustainability.

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This doesn't mean abandoning growth or becoming conservative by default — it means recognizing that the role of money is evolving. Assets that once represented potential must now be evaluated for function.

Most people spend years preparing financially to retire, but very little time preparing strategically. Retirement success is not accidental. It is the result of decisions made in advance, with clarity about purpose and a thoughtful framework for how resources will be used once paychecks stop.

That framework begins taking shape not in the year you retire — but in the year before that.

In the sections that follow, we'll explore how 2026 can become a turning point — a year to step back, rethink priorities and intentionally design the transition from growth to income with focus, purpose and strategy.

Redefining the job of money in retirement

One of the most overlooked parts of retirement planning has nothing to do with markets or portfolios. It's purpose. In past writings and conversations, I've often emphasized that retirement isn't the absence of work — it's the presence of intention.

When the structure of a career disappears, money must step into a new role: Not just as a resource, but as an enabler of meaning, choice and flexibility.

That's why the year before retirement is not just a financial checkpoint; it's a philosophical one. Income planning without purpose becomes mechanical. Purpose without a financial framework becomes fragile. The two must be designed together.

Once paychecks stop, the financial conversation immediately shifts to cash flow — not in theory, but in practice. Monthly income is no longer something you earn; it's something you must intentionally create and sustain.

Travel plans, hobbies, family support, charitable goals and lifestyle upgrades all compete for the same finite stream of income.

Retirement spending is rarely flat, and it's rarely predictable. The early years often bring higher discretionary spending, especially around travel and experiences that were deferred during working years.

At the same time, retirement introduces a new tax environment. Income may come from multiple sources, each taxed differently and often with less flexibility than a paycheck.

Required minimum distributions (RMDs), Social Security timing and the mix of taxable, tax-deferred and tax-free assets all influence how much income you actually keep — not just how much you generate. In retirement, taxes are no longer a background issue; they are a primary design constraint.

This is where many plans quietly break down. Investment growth alone does not solve income inefficiency. A portfolio can grow and still fail to deliver reliable, tax-aware cash flow.

As I've discussed before, wealth on paper is not the same as financial freedom. Freedom is measured by usable income, not account balances.

Only after purpose is clarified, cash flow needs are mapped, and tax implications are understood does investment growth re-enter the conversation — and even then, in a different role.

Growth becomes a supporting player, not the star. Its job is to reinforce sustainability, offset inflation and preserve optionality after all other planning objectives have been met.

For those retiring within 12 months, now is the time to consciously change the question from "How much can I make?" to "How does this all work together?"

Retirement success is rarely about a single decision. It's about alignment — between purpose, income, taxes and strategy — designed before the first retirement withdrawal is ever taken.

Step No. 1: Redefine work, purpose and the value of your time

Before any numbers are run or strategies discussed, retirement planning should begin with a deceptively simple question: What do you enjoy — and what are you good at — that you would do even if no one paid you?

This isn't about creating a side hustle or replacing a paycheck. It's about understanding how your time will be used once work is optional.

In previous articles, I've stressed that retirement is not a financial finish line; it's a redesign of daily life. Time, not money, becomes the most valuable asset — and how you choose to spend it will shape both fulfillment and spending patterns.

For some, this means repurposing time toward family, volunteering, mentoring or creative pursuits. For others, it may involve staying intellectually or socially engaged without the pressure of income production.

The point isn't productivity — it's intention. Without clarity here, financial planning becomes abstract. With it, money gains context.

Step No. 2: Define the income you need, not the income you could generate

Effective retirement planning doesn't start with maximizing income. It starts with defining baseline needs. This is a critical distinction.

What matters most is not how much income your assets could produce, but how much income your life requires to function comfortably and sustainably.

That baseline should include:

Ongoing debt payments
Core lifestyle expenses
Insurance costs
Health care considerations
Taxes
And the miscellaneous, often-overlooked expenses that inevitably arise

This exercise isn't about perfection. It's about honesty. Retirement plans tend to fail not because markets misbehave, but because spending assumptions were vague or unrealistic. Knowing your baseline creates a problem you can actually solve.

Step No. 3: Identify what's already known

Once baseline income needs are clear, the next step is identifying fixed-income sources — income that is predictable and not dependent on market performance. For most retirees, this includes Social Security and, for some, a pension.

These sources form the foundation of retirement cash flow. They reduce uncertainty and provide stability — but they rarely cover everything. The difference between your baseline income need and your fixed-income sources is what truly matters.

That difference is the income gap.

Step No. 4: Solve for the gap — that's the core of a plan

The income gap is where effective planning happens. It defines how much income must be generated from personal assets, how tax exposure must be managed and how investment risk should be calibrated. This equation — baseline needs minus fixed income — is far more useful than any projected rate of return.

Only after this gap is clearly defined does investment growth enter the conversation — and even then, it plays a supporting role. Growth exists to sustain income, manage inflation and preserve flexibility, not to drive decision-making.

This is the difference between owning investments and having a plan.

If you're retiring in 2027, 2026 is the year to move from assumptions to clarity. Before making changes to investments, income strategies or tax decisions, it's critical to understand whether your current plan is aligned with what comes next.

At its core, retirement planning is about transforming wealth into a system — one that generates income, reduces taxes and supports the life you want to live.

The WealthSync™ Process, built from decades of experience, helps business owners and high-achieving families navigate the retirement transition with intention. To help you understand where you stand today, we offer the 7-Minute WealthSync™ Diagnostic, designed to uncover hidden inefficiencies, silent tax leaks and gaps between your income needs and your vision for retirement. In just a few minutes, it provides clarity around how well your income, taxes and investments are working together — and where misalignment may exist. Take the 7-Minute WealthSync™ Diagnostic to see how your strategy stacks up.

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Brian Skrobonja contributed to this article. The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Brian Skrobonja is a Chartered Financial Consultant (ChFC®) and Certified Private Wealth Advisor (CPWA®), as well as an author, blogger, podcaster and speaker. He is the founder and president of a St. Louis, Mo.-based wealth management firm. His goal is to help his audience discover the root of their beliefs about money and challenge them to think differently to reach their goals. Brian is the author of three books, and his Common Sense podcast was named one of the Top 10 podcasts by Forbes. In 2017, 2019, 2020, 2021 and 2022, Brian was awarded Best Wealth Manager. In 2021, he received Best in Business and the Future 50 in 2018 from St. Louis Small Business.